|
Post by willowgirl on Nov 23, 2020 14:21:16 GMT
Biden's win had been projected, so I think that result was already baked into the equation, and the bump we saw last week had more to do with promising results from Covid vaccines.
What will the next four years be like? I think we can count on higher taxes and more regulation. However, this doesn't always hurt big businesses, the kind that are likely to be publicly-traded. It can even benefit them if it kneecaps their smaller competitors.
I think the automotive sector may take a hit as I've heard Biden is likely to reinstate "green" standards that will drive up new-car costs. OTOH, GM recently announced a breakthrough on EV battery technology and thus seems particularly well-positioned right now.
I think there is another stimulus package on the horizon and that money will be pumped straight into the economy, as the people in dire straits will spend it immediately on necessities while those who are doing OK will see it as a bonus that can be spent frivolously. That should keep the economy propped up for awhile, along with whatever other giveaways the Dems cook up for the gimme sector.
It will be hard to make long-term projections until the Georgia runoff is conducted and we know for certain whether the Senate is in R or D hands .. basically, whether there is a brake on the runaway train, lol.
Hopefully, rolling out the Covid vaccine will keep officials busy for awhile!
|
|
|
Post by Ozarks Tom on Nov 23, 2020 21:46:01 GMT
What we've seeing now, and have been seeing for the past many years is a mirage. There's just a fraction of value backing the price of stocks. As with central banks around the world, the Fed has been not just loaning money a zero interest rates, but actively buying even junk bonds. In other words, the world's economy is surviving on imaginary value.
Of the major economic players, I look for the EU to be the first to stumble, Germany isn't going along with the ECB and their eagerness to continue bailing out the Mediterranean countries. When they devalue the Euro look for the house of cards to tumble.
Depending on the GA senate races the next stimulus with either be a huge present to special interests with the left overs going to the public, or a smaller gift to the special interests, but either way every dollar brought digitally into existence will continue general inflation of commodities are hard goods.
When will the big plunge take place? Whenever the economic elites decide it's time for the "Reset". I'm guessing in about two years when the Biden administration has had time to go wild with their leftist spending.
|
|
|
Post by willowgirl on Nov 24, 2020 4:49:33 GMT
Tom, I'm wondering if (assuming the Senate stays in R hands) if McConnell will trade a new stimulus package for retention of the Trump tax cuts? I'd think those are the biggest bargaining chips on either side at the moment.
|
|
|
Post by paisley on Nov 24, 2020 5:45:14 GMT
Which stimulus plan... The bloated pay for mismanaged of of cities and states stimulus ....or a limited stimulus???
|
|
|
Post by Jolly on Nov 24, 2020 14:04:53 GMT
All the economic chickens haven't come home to roost. Sooner or later, the government cannot continue to keep the market propped up. The vaccine, even if it is effective, will take time.
I may be horribly wrong, but we are overdue for a market correction.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Nov 24, 2020 14:45:30 GMT
I agree with you Tom. I don’t trust any of it at all. The climbing stock market with everything that is happening simply doesn’t make sense.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Nov 24, 2020 15:19:14 GMT
All the economic chickens haven't come home to roost. Sooner or later, the government cannot continue to keep the market propped up. The vaccine, even if it is effective, will take time. I may be horribly wrong, but we are overdue for a market correction. "Correction" will probably be an understatement.
This whole house of cards is doomed. The derivatives are what I continue to watch...
That train is barreling down the track... the gasoline is poured, and someone is standing there with a lit match... the lemmings are pushing closer to the edge...
You get the idea.
|
|
|
Post by sawmilljim on Nov 24, 2020 16:43:42 GMT
When the first country refuses dollars for their products it will be the beginning of the the real crash. I predict that the idiots in charge will try war to try to prop the dollar a while longer.
Inflation has already started ! Once the Government takes change of production either by law change or heavy taxes this country will be socialist as they plan.
|
|
|
Post by paisley on Nov 24, 2020 17:11:36 GMT
sawmilljim, Everything is shipped in Alaska... Shipping cost by Lynden shipping increase posted 5% increase Friday. Honestly it is a jump but it is also a realistic increase do to the mandates due to a combo is reasons. Change with sanitation Change with health care restrictions for workers. We barge and they have to be able to deal with sick worker at sea So 5% is going to be a big jump here!
|
|
|
Post by themotherhen on Nov 24, 2020 19:14:00 GMT
I agree with you Tom. I don’t trust any of it at all. The climbing stock market with everything that is happening simply doesn’t make sense. Agreed, the Dow topped 30,000 today.
|
|
|
Post by willowgirl on Nov 24, 2020 20:31:15 GMT
Here's the thing: when the progressives say the rich are "hoarding all the wealth," they are on to something, however inelegantly expressed. It's more accurate to say that people with something to sell are capturing wealth, and some (the Jeff Bezos of the world) are spectacularly successful at it. What we're seeing in time is consolidation and integration. A hundred years ago, a shopper might have went to the meat market for some meat, the grocer for dry good, the shoe store for shoes, clothing store for clothes, etc. Now all of these purchases are increasingly becoming aggregated under one umbrella -- say, Amazon or Walmart -- and the merchants of individual products aren't dealing directly with the consumer anymore; they're selling their wares to the big distributor. The money flows up the chain to the guy at the top.
The bottleneck in this system is the fact the guy at the top can only capture as much money as the guy at the bottom is able to spend. And, unfortunately, a fair share of Americans have deplorably little buying power, for whatever reason.
The solution entertained by progressives is to hand out "free" money to the little guy, knowing that it will very quickly make its way up the chain to the guy at the top. This is the beauty of stimulus packages or an UBI -- they pump money into the system that is available for capture.
The problem, of course, is that if you pump too much froth into the cappuccino, everyone realizes there's no actually liquid in the cup -- your currency is no longer based on productivity, and people get nervous and run from it. In this regard, I think progressives are rather like the heroin user who is enjoying the high but figures he'll quit before he gets addicted. This has a tendency of not turning out well ...
But in the meantime, I think the market is anticipating a big injection of easily-captured money, which is why we're seeing it do what it's doing. (Trump, bless his heart, tried to goose it another way, via tax cuts, which let people keep more of the money they had earned while running the government on borrowed money. But that's another story!)
|
|
|
Post by Ozarks Tom on Nov 26, 2020 19:26:09 GMT
Charles Hugh Smith is of the opinion the "reset" has already occurred, and I have to admit he makes some good points. The collapse will come to the public's attention when there's a "bank holiday" and the DOW drops to 1500, but the money people know what's already happened, why, and are planning their escape after maximizing their take.
|
|
|
Post by joebill on Dec 2, 2020 18:34:16 GMT
I have never tried very hard to educate myself in the language one must use to operate in all of those lofty regions, but in a realistic sense, I have trouble making some of the connections others seem to be able to make with ease. I am trying to think this through as I go, so it may come out kind of choppy, but let's just see where it leads and maybe y'all can increase my understanding or maybe I can help clarify yours. To begin with, I dearly love commerce, trade, or whatever label you care to affix to the exchange of labor and material and currency between parties, and that need and exchange is unlikely to stop while man draws breath, and while I still need a turnip to eat and you still need a knife with which to cut the turnip. Of course, some folks have accumulated HUGE surpluses of currencies with which they can purchase far more knives and far more turnips than they can ever use, but none of them can ever grow a turnip nor make a knife. They have merely placed themselves in a position between the turnip growers and the knife makers to glean a percentage of all of the knives and turnips that get exchanged. They can do that because we now exchange knifes and turnips across the globe instead of only in our own communities. Now, enter the third party.....the money lender. In the field of commerce, his only function is providing operating capital to ventures that want to grow beyond their means. As I understand it, hardly anybody in today's world of commerce keeps enough money in the bank to operate their business day-to-day without a visit to the bank to make payroll or pay for inventory from time to time. Worse yet, the banks themselves are not operating on earned money any more for the most part. They are borrowing the money that they loan you from....uh......from you as a depositor a lot of the time. Some of the time, they make loans and sell those loans on the same day to other institutions. Yeah, they are supposed to have a reserve over and above what they are loaning, but guess what? "In March 2020, the Board of Governors of the Federal Reserve System reduced reserve requirement ratios to 0%, effectively eliminating them for all depository institutions." So, I guess we can say that the value of a turnip is not in danger of going away, since I still need to eat, and the value of a knife is holding fairly steady since you still need to cut, but the value of the currency is very much in question, since it is being "made" at a runaway rate with no chance of controlling it, in view of the simple fact that every time a bank makes a loan, it "creates money" to offset the loan. I DO understand that just inflation is only a small part of the money problem, but sufficient to say that in this day and age you cannot trust either the value NOR the availability of money in the present or future. Neither turnip nor knife, it is and will remain a complete wild card in reverse. A true wild card can be played for any other card, but ultimately our money will stand in for nothing at all. This does NOT mean that your turnip nor my knife is without value, only that there is not a proper and steady vehicle on hand with which we can store that value or use to make exchanges other than direct exchange of goods and services. It also means that if you want to do business BEYOND your means, on borrowed money, you may be out of luck for the foreseeable future, and the same applies to your employer, if you have one. Up to this point, I seem to be just rambling, but I have managed to square up a few things in my head a bit better. Now, I gotta go postal (to the post office). I dunno if I am done with this or not, but I would sure welcome any input from others who may have some wisdom to shed instead of, like me, just stating the obvious more or less for my own edification. C'mon, people...educate me beyond my current state....captain obvious
|
|
|
Post by Ozarks Tom on Dec 2, 2020 21:02:33 GMT
joebill , I'll touch on a few things that might help those things you've tangentially talked about. For instance, the stock market: To understand what's happening in the stock market we have to look at who benefits most from a corporation's stock value. That would be mainly the CEO and CFO, whose bonuses aren't so much tied to the profitability of the company as to the increased value of the company. Typically, their bonuses consist mainly of stock options, where they're given so many shares of company stock at a very reduced value. They can exercise those options at any time, meaning if they can pump the company's stock prices up, they clean up. Currently there's no logical ratio between the major corporation's profits and their stock prices. One can only assume the stock prices are grossly inflated through manipulation. The dollar has been realistically worth nothing since we went off the gold standard, and Federal Reserve notes replaced silver certificates. It's only use is in commerce, but don't try to trade federal reserve notes back into the treasury, they'll laugh at you. For many decades we've dealt with "Fiat Money". Definition of fiat 1 : a command or act of will that creates something without or as if without further effort According to the Bible, the world was created by fiat. 2 : an authoritative determination : dictate a fiat of conscience 3 : an authoritative or arbitrary order : decree government by fiatIn other words, because the government tells us so. Before we went off the gold standard, the dollar was exchangeable for gold at will. That made the government somewhat live within its means. We still ran a deficit and borrowed from the Treasury when they sold the T-bills to the world. Now, the world isn't buying, but the Fed is with digitally created dollars. Then the Treasury borrows those dollars and pays Congress' bills. Could it get any phonier than that? As with all magician acts, they eventually run out of illusions, and it's coming.
|
|
|
Post by joebill on Dec 2, 2020 22:52:20 GMT
I am not particularly interested in the stock market. I used to be a interested observer when I owned some insurance policies that were affected by it, but I replaced them with a bank account that will cover the same things and cashed them out, so the market has very little effect on me, other than the effects it has on business in general, by making people alternately feel rich and poor, affecting how willing they are to spend money or how eager they are to turn their hobbies into cash cows, which at times has made my products more popular. Going back to basics, if the objects of our production still have value, then the destruction of the currency will only affect our ability to extract that value and put it to work for us in ways other than making turnip soup and cutting things It will also, in effect, make one heck of a lot of people dead broke, but then it seems to me that one heck of a lot of people have been dead broke for years, if not decades, so what else is new? People who are not accustomed to being dead broke will join in the club. What is worse is that employees will have no way of getting paid for their production in ways that they can convert that production into useful material and services. I may be getting somewhere, but I am not sure where. Maybe we need an economy based on bread and toilet paper.....or oil! "this certificate can be exchanged at your local gas station for a dollar's worth of gas or diesel" so it would have value for dang near anybody or at least would have a way of being redeemed.....not worthless any longer.....captain o0vious
|
|